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N.R. NARAYANA MURTHY USED TO THINK OF HIMSELF as a committed socialist, but three days in a Yugoslav lockup changed his mind. Back in the early 1970s, while traveling through Europe by train, Murthy was seized by police in a town near the Yugoslav-Bulgarian border. He had been chatting up a fellow passenger in French, and he believes that her boyfriend complained to a cop. Murthy was kept in a room in the train station for 72 hours and shipped out on a freight car. "There was no going back to communism after that," he says.
Today, as Murthy sits in the chairman's office of Infosys, a Bangalore-based software and services company, his capitalist transformation is complete. Murthy has helped turn outsourcing into a multibillion-dollar business that has rejuvenated U.S. and European companies by slashing their tech spending. But his success has also contributed to fears that American software-engineers' jobs could migrate to India, making outsourcing a hot political topic.
Murthy and six friends founded Infosys in 1981 with $250 in start-up capital. The company's early years were arduous. In the 1980s, Murthy recalls, it took a year to get a telephone line, and a dozen trips to New Delhi to get permission to import a single computer. But the firm quickly established a reputation as a reliable partner for American and European businesses looking to contract out software-programming work. That first-mover advantage has paid off. Infosys had $1.06 billion in revenues last year and expects that figure to rise as much as 40% this year.
Murthy, 57, is quietly fighting the backlash against outsourcing. "We can't get angry and shout slogans," he says. "If we focus on delivering value to our clients, ultimately we will win." After building Infosys into an outsourcing behemoth, Murthy is now trying to protect the company from its own success. By Aravind Adiga/Bangalore
DIGITAL-CAMERA DYNAMO SONY | JAPAN
No one likes to have his boss looking over his shoulder. But Shigeki Ishizuka, head of Sony's digital-camera division, says he is unfazed whenever Shizuo Takashino--Sony's executive deputy president and one of the legendary team that created the Walkman--drops by. "I look forward to seeing him," Ishizuka says with a laugh, adding that he is always prepared for Takashino's frequent suggestion to "make it smaller."
Ishizuka can get away with a jest; he has cred all his own. Although many divisions in the Sony juggernaut have stumbled in recent years, Ishizuka has kept his department at the forefront of the exploding digital-camera industry by introducing innovative products.
Virtually nonexistent even a decade ago, the market for digital cameras grew to $17 billion in 2003, and sales are expected to soar 39% this year, according to research firm IDC. And since introducing in 1996 the DSC-F1, one of the first affordable digital cameras, Sony has gone on to capture an industry-leading 18%. Canon is close behind with 16%, and Olympus and Kodak have 13% and 12%, respectively.
Intriguingly, Sony is the only major digital-camera maker without a traditional film background. Ishizuka, 45, considers that the company's greatest advantage. With no stake in the 35-mm-camera market to protect, Sony was able to apply a fresh approach as consumers began switching to digital.